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Grassley Says He Will Address Medicare Physician Payments This Year

Senate Finance Committee Chair Chuck Grassley (R-Iowa) on Wednesday said that the committee will address a bill on Medicare physician reimbursements by the end of the year, CongressDaily reports. Physicians face a scheduled 4.3% reduction in Medicare reimbursements on Jan. 1, 2006. At a committee hearing on legislation that would link a part of Medicare reimbursements to quality of care, Grassley said that he expects a bill he introduced earlier this month with Sen. Max Baucus (D-Mont.) "to be part of a our final package this year" (CongressDaily, 7/27).

The legislation would allow the HHS secretary to reward providers first when they report quality data and later when they improve quality or meet certain quality thresholds. The legislation would establish a "value-based purchasing" system for providers -- such as hospitals, physicians, Medicare Advantage plans, home health agencies and skilled nursing facilities. Under the bill, physicians who report quality data would receive the full update to Medicare reimbursements allowable under current law in 2007 and those who do not report quality data would have their updates reduced by 2%. The legislation also would establish a national health care IT network pilot program that would allow providers to exchange clinical, claims and outcomes data for Medicare and Medicaid beneficiaries, as well as clinical trial results and practice guidelines to help improve care (California Healthline, 7/5).

Grassley said, "What we have is a systemic failure of Medicare payment systems to reward quality." Baucus added, "We pay today whether outcomes are good or bad. We ought to pay when outcomes are good" (CongressDaily, 7/27). Separately, House Ways and Means Health Subcommittee Chair Nancy Johnson (R-Conn.) announced that she plans to introduce legislation on Thursday that would revise the Medicare physician reimbursement formula (CQ HealthBeat, 7/28).

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